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  • 4 minutes IMPORTANT ARTICLE BY OILPRICE.COM EDITOR - "Naked Short Selling: The Truth Is Much Worse Than You Have Been Told"
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Suriname Looks To Ramp Up Oil Production In A Big Way

Suriname Looks To Ramp Up Oil Production In A Big Way

Looking to replicate neighboring Guyana’s…

Brazil Looks To Sell Petrobras Units As Part Of $20B Privatization Plan

Brazil is pushing for major state-owned companies to privatize some subsidiaries as the Brazilian government of new far-right President Jair Bolsonaro looks to raise US$20 billion in state asset sales in 2019.

State-held oil firm Petróleo Brasileiro (Petrobras) should sell most of its 36 subsidiaries, Brazilian secretary of privatization Salim Mattar said at an investment conference in Sao Paulo on Tuesday, as carried by Reuters.

Mattar said that subsidiaries of Petrobras and banks Banco do Brasil SA and Caixa Economica Federal should be put up for privatization as the government wants those state-owned firms to sell many of their units within four years.

Brazil also plans to privatize utility Eletrobras via additional share sales on the market, the secretary of privatization said.

At state firm Petrobras, the new chief executive Roberto Castello Branco—who was tapped in November by Bolsonaro to lead the company and officially took the reins in early January—had previously advocated for a full privatization of Petrobras.

Since he was picked to lead the oil firm, however, Castello Branco has ruled out a Petrobras privatization, but still wants to sell non-core assets of the company to reduce its massive net debt of US$72.888 billion as of the end of the third quarter of 2018. Petrobras is the world’s most indebted listed oil company.

“The privatization of the company is not in question. I do not have a mandate to think about it,” Castello Branco said in November.

Yet, the sale of non-core assets is expected to continue under Castello Branco, whose strategic vision for Petrobras includes “portfolio management, capital cost reduction, and relentless pursuit of cost reduction.”

Between 2016 and end-October 2018, Petrobras sold assets worth US$20 billion, according to Reuters estimates, while Reuters sources said in October that the Brazilian state oil firm could divest another US$20 billion worth of assets through 2019.

By Tsvetana Paraskova for Oilprice.com

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